Dara Khosrowshahi just delivered incredible news for Uber Stock investors

Uber Technologies (NYSE: UBER) operates the world’s largest vehicle transport platform, in addition to the booming commercial food and freight delivery networks. But the company relies on 9.7 million drivers to facilitate rides and deliveries for its 202 million monthly active users, and they are its biggest cost by a country mile.

Uber is now actively partnering with self-driving car developers to automate as many rides as possible, which will dramatically improve the economics of each ride. In fact, CEO Dara Khosrowshahi says this change presents the company with a multi-trillion dollar opportunity and could lead to a significant increase in Uber stock over the long term.

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Here’s why Uber could be the ultimate investment for the coming autonomous revolution.

Digital rendering of a self-driving car stopped at a crosswalk surrounded by people. — Image source: Getty Images.

Uber recorded $193.4 billion in gross bookings by 2025, representing the dollar value of every ride, food order and commercial delivery facilitated by its platform. Drivers took home $85.4 billion for the year, which was the largest share of those gross reserves.

After also deducting other costs, such as money paid to restaurants for food orders, Uber’s revenue in 2025 amounted to $52 billion. If we expand further and factor in operating expenses, the company adjusts non-GAAP (generally accepted accounting principles) profit was $5.2 billion for the year. As you can see, only a very small portion of Uber’s huge gross reserves flow to their top and bottom lines.

However, if the company reduces (or eliminates) the huge $85.4 billion cost of its human drivers, a lot of that money would quickly turn into revenue and profit. This is where autonomy comes in, and Uber is investing heavily to become the best platform in this emerging space.

Uber knows that building a capable self-driving car is only a small part of competing in the autonomous boom. Without a network that can manage utilization efficiently, a standalone service simply won’t succeed. For example, deploying too many cars in a city could lead to an underutilized fleet that bleeds into profits, while not deploying enough cars will cause users to wait an unacceptable amount of time for a ride. Uber has more than 15 years of experience managing these challenges.

Also, achieving scale is an incredibly expensive endeavor. Uber already has the users and infrastructure in place, which is why more than 20 companies developing autonomous vehicles are connecting to its network. One of them is alphabet‘s Waymowhich is now conducting more than 450,000 paid autonomous rides each week in five US cities, using a combination of its own network and Uber’s.

Currently, autonomous vehicles are used in only 0.1% of all carpooling trips worldwide, so this transition won’t happen overnight. However, Uber plans to offer autonomous rides in 15 cities around the world by the end of 2026, and aims to be the biggest player in this space by 2029. As mentioned, Khosrowshahi hopes this will create a multi-billion dollar opportunity for his company.

Uber recognizes that ride-sharing won’t be a catch-all industry, because the opportunity is simply too big. Tesla (NASDAQ: TSLA)for example, it could become a serious contender because it plans to build its own transportation network to accompany its Cybercab autonomous robotaxi, and unlike most start-ups in this space, it has enough financial resources to do so.

However, I think Uber could be the best investment in the entire industry, not only because of its strategy but also because of its attractive valuation. Its stock trades at a price-to-sales (P/S) ratio of just 3.1, making it substantially cheaper than Tesla:

Additionally, based on Uber’s 2025 adjusted earnings of $2.45 per share, its stock is trading at a price-to-earnings (P/E) ratio of just 30.1, which is a discount to the 32.8 P/E ratio of Nasdaq-100 index

In other words, Uber could be undervalued relative to many of its peers in the tech sector. Tesla stock trades at a sky-high P/E of 377, which in my opinion almost makes it uninvestable at current levels, even if you factor in a successful foray into the self-driving car industry.

In short, long-term investors looking to expose their portfolios to the self-driving revolution may want to consider buying Uber stock.

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Anthony DiPizio has no position in any of the aforementioned stocks. The Motley Fool has positions in and recommends Alphabet, Tesla and Uber Technologies. The Motley Fool has one disclosure policy.

Dara Khosrowshahi just delivered incredible news for Uber Stock investors was originally published by The Motley Fool

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